* Thaw in Sino-U.S. trade dispute boosts investor buying
* Thai baht, Chinese yuan and Taiwan dollar lead gains
* S.Korean won falls as factory activity shrinks
(Adds text, updates prices)
By Aditya Soni
July 1 (Reuters) - A trade truce between the United States
and China prompted a relief rally among most Asian currencies on
Monday, with the Chinese yuan and Thai baht leading the gains.
The troubled negotiations are set to resume after Washington
offered concessions including no new tariffs and an easing of
restrictions against Huawei, while Beijing agreed to make
unspecified new purchases of U.S. farm products. "Investors (have) heaved a massive, but exhausted, sigh of
relief that both the U.S. and China opted to push the reset
button and restart trade negotiations amidst other pleasantries
– now we'll have to see, whether it all sticks," Stephen Innes,
managing partner at Vanguard Markets Pte Ltd said.
The last major round of Sino-U.S. trade talks collapsed in
May, rattling financial markets and renewing concerns the
standoff between the two biggest economies could trigger a
global recession.
The weekend trade truce, agreed between U.S. President
Donald Trump and his Chinese counterpart Xi Jinping on the
sidelines of the G20 summit in Japan, sent the yuan CNY=CFXS
to its highest level since June 21.
The baht THB=TH was the biggest mover, up as much as 0.6%
to its highest level in more than six years as the resurgent
risk sentiment saw investors largely shrug off slightly weaker
inflation data in June. The trade-dependent Taiwanese dollar also joined the rally,
firming to a near two-month peak.
The relief in markets following the weekend Trump-Xi meeting
was underscored by the broadening global impact of the Sino-U.S.
trade war.
Private surveys showed factory activity in South Korea and
China shrinking, hurt by slowing global trade. "Cracks in both the U.S. and Chinese economy argues for
them to find common ground to end the trade hostilities, but if
both parties continue to approach the discussion from an
ideological perspective and from a position of strength a
solution could be difficult to achieve," Jason Daw, Head of EM
Strategy at Societe Generale said.
The won KRW=KFTC traded 0.1% lower. Sentiment was also
hurt by a trade row between Seoul and Tokyo which will see Japan
tighten restrictions on exports of high-tech materials used in
smartphone displays and chips to South Korea.
The following table shows rates for Asian currencies against
the dollar at 0523 GMT.
CURRENCIES VS U.S. DOLLAR
Currency Latest bid Previous day Pct Move
Japan yen 108.320 107.88 -0.41
Sing dlr 1.354 1.3522 -0.12
Taiwan dlr 30.963 31.072 +0.35
Korean won 1156.000 1154.7 -0.11
Baht 30.530 30.69 +0.52
Peso 51.090 51.22 +0.25
Rupiah 14100.000 14125 +0.18
Rupee 68.903 69.02 +0.16
Ringgit 4.133 4.13 -0.07
Yuan 6.839 6.8650 +0.38
Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 108.320 109.56 +1.14
Sing dlr 1.354 1.3627 +0.66
Taiwan dlr 30.963 30.733 -0.74
Korean won 1156.000 1115.70 -3.49
Baht 30.530 32.55 +6.62
Peso 51.090 52.47 +2.70
Rupiah 14100.000 14375 +1.95
Rupee 68.903 69.77 +1.26
Ringgit 4.133 4.1300 -0.07
Yuan 6.839 6.8730 +0.50